Credit check ban for insurance pondered
The P.E.I. government is considering banning insurance companies from using someone's personal financial information to set the price or eligibility for a policy.
The government says an increasing number of companies on P.E.I. are using credit history, income level, net worth and debt levels when people are purchasing residential or auto insurance.
"People have been denied, so that's obviously the huge impact, particularly in homeowner's insurance where you need it for a mortgage," said superintendent of insurance Robert Bradley.
"We've seen stories where people's rates have been tripled, apparently, but we haven't heard from those people directly."
While some suffer under the system, Bradley said people with excellent credit scores can see a discount.
Insurance companies argue it's a valid underwriting tool, but Ontario, Newfoundland and Labrador, and Alberta have banned the practice for automobile insurance.
A discussion paper on the new regulations was presented in the legislature Wednesday. Feedback is welcome until Jan. 11.
